PART THREE OF THREE Reorganization Plan For Manufacturing and Distribution Facilities: -- Signed a letter of agreement to sell Ore-Ida's foodservice business (including six factories) to McCain Foods Limited of New Brunswick, Canada. -- Close one of five major ketchup and condiment-making factories in North America. -- Accelerating ECR initiatives at Heinz North America. This action should deliver annualized operating savings of $20 to $30 million by Fiscal 1999 and decrease working capital by about $40 to $50 million. -- Realign production and distribution centers for pet foods to place factories and warehouses closer to Heinz customers. As a result, the company will reduce its distribution costs. This will generate $10 to $15 million in annual operating savings. -- Develop alliances with other dry pet food manufacturers. Such co- packing arrangements will allow Heinz to substantially reduce its delivered cost for dry pet food. -- Consolidate pet treat production to reduce overhead costs. -- Dramatic reduction of Weight Watchers cost by exiting the Personal Cuisine business in 238 of our centers which sold food. We will close 55 centers and will retain 183 of the high-attendance centers as classrooms only. These actions should reduce cost for Weight Watchers in the U.S. by $10 to $15 million annually. -- Consolidate the manufacture of Weight Watchers brand foods for Europe in a single, expanded factory in Dundalk, Ireland. Currently, the products -- which are highly successful and sold in the U.K., France and the Nordic countries -- are co-packed for Heinz in five different locations. With 57% market share in the U.K., Weight Watchers entrees exceed the combines share of Nestle and Unilever. -- Automate the labor-intensive cleaning of tuna at StarKist plants in Puerto Rico and American Samoa. This effort will generate an annual savings of $12 to $15 million and enhance product quality. -- Optimize production between Puerto Rico and Samoa to reflect the lowest delivered cost on each variaty of tuna fish (albacore, chunk light and special recipe) taking account of labor rates, cost of fish and tax benefits. -- Downsize or close as many as three seafood production facilities that no longer fit within Heinz's global low-cost manufacturing strategy. In Europe, StarKist is leveraging the substantial benefits of its low-cost, duty- free plants in Ghana and the Seychelles. -- Revise the manufacturing configuration for Heinz Bakery Products by closing, selling or downsizing up to five of its ten plants. -- Reorganizing the Wattie's business in New Zealand by combining the three remaining companies into one unit, eliminating substantial overhead and centralizing all ECR and category management initiatives. -- Closed several production facilities in Australia and New Zealand. Wattie's will now focus on developing its Tomoana plant site as a supply source for Japan. Worldwide Expansion and Development of Production Centers: Heinz is planning to expand and develop its international production centers in these locations: -- The Seychelles for tuna sold in Europe -- Ghana for tuna sold in Europe -- Puerto Rico and Samoa for Star-Kist tuna -- Ireland for frozen food sold into the U.K. and Europe -- Ozzaro Taro for infant foods in Northern Italy -- Aligarh, India for nutritional drinks and infant foods -- Jacksonville, Florida for portion control products -- Hasting and Tomoana, in New Zealand, particularly for exports to Asia and the Pacific. ABOUT HEINZ: With sales approaching $10 billion, H. J. Heinz Company is one of the world's leading food processors and purveyors of nutritional services. Its 50 affiliates operate in some 200 countries, offering more than 4,000 products. Among the company's famous brands are Heinz, StarKist, Ore- Ida, 9-Lives, Weight Watchers, Wattie's, Plasmon, Farley's, The Budget Gourmet, Earth's Best, Ket-L Ration, Kibbles 'n Bits, Orlando, Olivine, and Guloso. * * * The above contains certain forward-looking statements which are based on management's current views and assumptions regarding future events and financial performance. Reference should be made to the section "Forward- Looking Statements" in Item 1 of H. J. Heinz Company's Annual Report on Form 10-K for the fiscal year ended May 1, 1996, for a description of the important factors that could cause actual results to differ materially from those discussed above. SOURCE H.J. Heinz Company Note to assignment editors: A Heinz video news release/B-roll which includes interviews with A. J. F. O'Reilly and William R. Johnson and company production footage is available as follows: SATTELLITE INFORMATION FEED No. 1 FEED No.2 DATE: March 14, 1997 March 14, 1997 TIME: 1:30 pm - 2:00 pm (Eastern) 4:00 pm - 4:15 pm (Eastern) (10:30 am - 11:00 am Pacific) (1:00 pm - 1:15 pm Pacific) COORDS: GALAXY C4 TRANS9 GALAXY 9 TRANS 22 AUDIO: 6.2, 6.8 MHz 6.2, 6.8 MHz CONTACT: Ted Smyth, VP-Corp. Affairs, 412-456-5780, or Debora S. Foster, Gen. Mgr.-Corp. Communications, 412-456-5778, both of H. J. Heinz; or Michael Mullen of Ketchum Public relations, 412-456-5778, for H. J. Heinz/ /H.J. Heinz Co. press releases are available through Company News On-Call by fax, 800-758-5804, ext. 402575, or at http://www.prnewswire.com (HNZ)